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MINUTES OF THE 2020 (56th) ANNUAL MEETING

OF THE CBI FEDERAL CREDIT UNION The 2020 56th Annual Meeting of the CBI Federal Credit Union was held on March 11, 2020 in the Illinois Conference Room at the office of CB&I in Plainfield, Illinois, and via video link with members attending from the Woodlands, TX Office. President Dave Lacey chaired the meeting and Thomas Mullen was the acting Secretary. Katye Wilkinson supervised the recording of the attendance at the meeting. The meeting was called to order at 4:19 p.m. by the Chair, who read to the assembled members the Notice of the Annual Meeting (a copy is attached to these minutes) which was printed for the quarterly newsletter and mailed with statements as of December 31, 2020. Fran Parkison reported to the Chair that a quorum was present. It was moved by Pat Dywan, and seconded by Nancy Nelson, to accept the minutes of the 2019 Annual Meeting. This motion was approved unanimously by the members.

Dave Lacey presented the Director’s Report. Year on year highlights included: Total Assets were down $1.3 million to $17.4 million, primarily due to paydown on existing loans; charge-offs were reduced by 68% to $62,000; Net Income was a negative $8,400; $52,686 needed to be pulled from reserve to accommodate a change in Allowance for Loan Loss Calculation, as agreed with NCUA. CB&I Storage Tank Solutions remains a part of McDermott, which filed for Chapter 11 bankruptcy in January 2020. McDermott’s cash flow impacted the repayment of the Credit Union’s charged-off Flood Loans. However, prior to the Chapter 11 filing, McDermott paid $202,000 in Flood Loan invoices, leaving a balance of $2,215. Remaining Flood Loan balances continue to be secure from default, through McDermott loan repayment of charge-offs. Managers from the Illinois Credit Union League (ICUL) assisted the Directors in analyzing the current status and identifying possible future strategic scenarios. However, the uncertainty of McDermott and of the global market impacted the ability to finalize strategic plans and the focus in the latter half of 2019 was on operational improvements. Further strategic planning activities are planned for March 2020 where various strategic options will be evaluated. The Credit Union is currently a Single Employer Group (SEG) serving CB&I, Lutech and McDermott employees. Our growth opportunities will rely on adjusting our products and services to meet our members’ needs. The Board’s focus will continue to be financial soundness, security, competitiveness and a qualified staff providing excellent service. Dave thanked the directors, committee members and staff for their significant efforts and dedication. A special thank you was extended to Eugene Sheeren, Bob Latzke and Dan Carroll, for their past service, as they leave their Board and Committee positions. Dave invited Credit Union members to consider volunteering for a Board or Committee position. Finally, a big thank you to all our member-owners who continue to support the CBI Federal Credit Union, which was founded on the principle of “People Helping People”. On the motion by Jeff Baker, and seconded by Fran Parkison, the Director’s Report was unanimously approved by the members.

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Robert Doty presented the Treasurer’s Report. The report included a brief summary of the Balance Sheet and Income Statements as of December 31, 2019. Total assets decreased from $18.64M at the end of 2018 to $17.36M as of 12/31/19. Savings and Share Draft accounts were down by $1.4M and Member IRA Certificates and Term Share Certificates were down about $164K for a net loss of $1.2M in members’ accounts. Net Loans decreased in 2019 by $1.5M. Our Real Estate Loans saw a net decrease of $427K and regular loans decreased by $1.1M. Visa balances increased by $17K. Total Income for 2019 was down $41K, Operating Expenses were down $37K and the Provision for Loan Loss decreased by $54K. Note the NCUA examiners require us to provide a certain percentage in reserve for each loan category. Net income was down $8.4K for 2019. Our membership decreased by 137 over the prior year due to dormant accounts, which now are required to be reported after 3 years of inactivity, instead of 5 years. Non-performing loan charge-offs totaling $61.5K were made in 2019, primarily due to Signature Loans and Automobile loans. The Loans-to-Assets ratio goal we would like to have (be) is over 60% and we achieved 60.69% which was lower than 2018 due to our decrease in the loan portfolio. During 2019, our dividend rate remained at 0.20%. Current interest rates in the market-place are expected to decrease. On the motion by Jeff Rinehart, and seconded by Jeff Baker, the Treasurer’s Report was unanimously approved by the members.

Michele Timpe presented the Manager’s Report by starting off explaining how 2019 was a much better year than 2018 for the credit union due to charge-offs at a much lower percentage. We recognize that we need to continue to focus on technology of how to make things easier for the member either by opening an account online, applying for a loan through DocuSign or by their accessing accounts online through our Virtual Branch site. The survey resulted in over 60 responses from the membership which was a great turnout since we haven’t seen a response for a period of time. Last year we did introduce Text communication which is a great feature to reach out to members if no email address is available. We also introduced Visa Gift Cards. On the motion by J.T. Hwang, and seconded by Pat Dywan, the Manager’s Report was unanimously approved by the members The Credit Committee Report was presented by Ray Moen, who reported that the committee consists of Deanna Young, Rae Jensen, Monique Antos and Ray Moen, as Chairman. During 2019 the committee approved 102 new loan applications requesting more than $1.6M, which was an increase of 15% from the $1.38M approved in 2018. We continue to see new and used automobile loans to be one of our most popular programs with a small increase in Signature Loans. We currently have 687 VISA card accounts on file which have also been reviewed by the Committee. In 2019, 3 new First Mortgage Loans were completed for more than $480,000, and 16 new Instant Advance Loans were written for $18K

The Committee encourages fellow members to consider the Credit Union for their borrowing needs, especially with our 1.0% cash back on vehicle loans and other special loan programs. Ray expressed how privileged he felt to serve with these hard-working volunteers and he thanks Deanna Young, Ray Jensen, and Monique for their time and thanked Dan Carroll for

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his support and participation with the committee for these last three years of service and wish him the best. On a motion by Patti Rice, seconded by Jeff Rinehart, the Credit Committee report was unanimously approved by the members.

The Supervisory Committee Report was presented by J.T. Hwang. The committee consists of Christopher Patti (Chairman), Scott Harmon and J.T. Hwang. During 2019, Desmond & Ahern performed the Agreed Upon Procedure audit as of June 30, 2019. This type of audit is performed as required by NCUA rules. There were no material concerns but some recommendations. During the past 12 months, the committee conducted a total of 14 various audits throughout the year such as surprise cash count on teller drawers, review on-going file maintenance report of member’s accounts on shares, loans, address changes, etc., bank reconciliations along with general ledger activity for allowance for loan loss, negative shares and dormant accounts followed all the way through to escheatment. A membership verification was performed this year by the committee which is required every 2 years. No significant exceptions were noted in our various audits. On a motion by Nancy Nelson, and seconded by Rob Schick, the Supervisory Committee report was unanimously approved by the members. Copies of all the reports, Agenda of the Annual Meeting, and the attendance list are attached to these minutes. Unfinished Business: There was no unfinished business New Business: The President then called for nominations for the election of three directors. Thomas Mullen of the Nominating Committee gave the report. The Nominating Committee for this year’s Annual Meeting of Members consists of Dave Lacey, Thomas Mullen and Bob Doty. The Committee nominated the following persons to be Directors of the Credit Union for a three-year term to March, 2020: Dick Poirier, Jeff Garrison and Rob Schick. Eugene Sheeren has declined to serve for another term. These three nominated persons were contacted and have volunteered to serve the members of the credit union. Mr. Mullen called for any additional nominations from the floor and there were none. A motion was made by Jeff Rinehart, and seconded by Nancy Nelson, to unanimously elect these three nominated members. On behalf of the Credit Union Directors, Committees, Staff and members, Dave Lacey thanked and presented plaques to the following retiring directors for their years of service to the CB&I Federal Credit Union.

• Eugene Sheeren 26 Years of Service Director and Various positions • Dan Carroll 3 Years of Service Credit Committee • Robert Latzke 4 Years of Service Supervisory Committee

A drawing for five $25 door prizes was held. Winners were: Yvonne Smith, Jeff Baker, Michele Timpe, Frank Bianchetta and Fran Parkison.

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There being no further business to come before the meeting, the meeting was adjourned at 5:25 p.m., on a motion by J.T. Hwang, and seconded by Patti Rice. This motion was unanimously approved by the members.

Dave Lacey, Chairman _____________________________________ Thomas Mullen, Acting Secretary ______________________________

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Charter Number 15848CBI FEDERAL CREDIT UNION13717 S. Route 30, Unit 157Plainfield, IL 60544

Financial and Statistical Report 12/31/2020 12/31/2019

BALANCE SHEET

AssetsRegular Loans 2,734,206 4,166,148First Mortgage Loans 3,543,004 4,227,499Home Equity Loans 52,073 126,691VISA Balances 712,604 881,993 Total Loans 7,041,887 9,402,331Less: Allowance for Loan Losses -120,486 -130,126 Net Loans 6,921,401 9,272,205

Cash 148,818 213,081

Federal Agency Securities / U.S. Gov't Obligations 300,000 600,000Alloya Corporate F.C.U. Deposit 2,293,960 804,545Alloya Corp. Certificates of Deposit 0 0Certificates of Deposits at Banks & CUs 8,065,112 4,958,106Money Market Accounts at Banks & CUs 1,183,293 1,078,627VISA Clearing Fund 24,883 27,658NCUSIF Capital Deposit 154,938 167,478 Net Investments 12,022,186 7,636,414

Furniture, Equip. and Office Space (net of depreciation) 0 0All Other Assets (prepaids and accruals) 39,025 238,303

Total Assets 19,131,430 17,360,002

Liabilities and EquityAccounts Payable & Disputes Pending -8,903 10,297VISA Payments in Process 0 1,333Dividends Payable -1,578 0Taxes Payable 1 5Accrued Expenses 20,568 15,262ATM in Transit or Drafts in Process 21,228 37,200 Total Liabilities 31,316 64,097

Members' Savings 9,039,153 8,709,857Holiday Club Savings 10,759 13,014Money Market Accounts (new in '18) 309,673 133,623Share Draft Accounts 5,173,164 4,229,746Term Share Certificates 1,649,321 1,496,707Individual Retirement Accounts 1,151,043 910,150 Total Shares 17,333,114 15,493,097

Regular Reserve 500,000 500,000Undivided Earnings 1,267,000 1,302,808

Total Liabilities and Equity 19,131,430 17,360,002


Financial and Statistical Report 12/31/2020 12/31/2019

STATEMENT OF INCOME

IncomeInterest from Regular Loans 165,871 216,985Interest from First Mortgage Loans 145,296 172,781Interest from Home Equity Loans 3,962 7,462Interest from VISA Outstanding Balances 56,816 64,856

Total Income From Loans 371,945 462,084

Interest from Investments 140,775 155,711

Total Interest Income 512,720 617,795

VISA Interchange Income (from Debit & Credit Cards) 68,079 77,509Other Income (Fees and FML Referral Income) 28,663 35,551Gain on Investments (or Loss) 0 0Other Non-Operating Gain (or Loss) 0 0

Total Income 609,462 730,855

ExpensesEmployee Compensation 198,545 194,646Employee Benefits 29,011 29,664Association Dues (ICUL) 11,054 11,829Office Occupancy 34,521 34,528Office Operations & Conference Costs 57,912 53,997Loan Servicing & FML Costs 19,013 15,970Card Processing Expenses (CSCU/FIS, LSC/ICUL) 93,841 108,427Account Processing Services (Fiserv, FSCC, CO-OP) 107,205 112,478Annual Audit and NCUA Examination Fees 10,930 8,922Miscellaneous (incl. $4,200 Fraud Loss & $3,200 Legal Fees in '20) 8,083 662

Total Operating Expenses 570,115 571,123

Provision for Loan Losses 19,000 110,686Interest Paid on Borrowed Money 0 0

Total Expenses Before Dividends 589,115 681,809

Dividends Paid (No Dec. Bonus Dividend In '19 or ‘20) 56,154 57,427

Total Expenses 645,269 739,236

Regular Net Income (before Extraordinary Expenses) -35,807 -8,381NCUA Corporate Stabilization Plan (2009-13 = -$12 0 0

Reported Net Income (no NCUA Assessments were required) -35,807 -8,381


Financial and Statistical Report change 12/31/2020 12/31/2019

Amount Transferred To Regular Reserve 0 0

Net Income Transferred To Undivided Earnings -35,807 -8,381

Number of Members at Year-End (78) 1,718 1,796

Dollar Amount of Loans Made During the Year 1,601,817 2,102,420

Number of Net New Loans Made During the Year (62) 59 121

Dollar Amount of Loans Made Since Organization 82,312,779 80,710,962

Number of Loans Made Since Organization 59 12,705 12,646

Dollar Amount of Delinquent Loans at Year-End 208,817 436,985

Loan Amounts Charged-Off 33,293 61,515

Recoveries on Loans Charged-Off 4,256 9,072

Home Equity Lines of Credit 0 707,700

Number of Active Home Equity Loans 7 7

VISA Lines of Credit 3,523,824 4,145,744

Number of VISA Credit Cards on File (106) 581 687

Number of Active Classic Cards (54) 211 265 Number of Active Platinum Cards (19) 165 184

Loans / Shares Ratio 40.63% 60.69%

Loans / Assets Ratio 36.81% 54.16%

Total Investments / Assets Ratio 62.84% 43.99%

Total Reserves + ALL / Assets Ratio 9.87% 11.13%

Total Reserves + ALL / Total Loans 26.80% 20.56%

Delinquent Loans / Total Loans 2.97% 4.65%

Return on Average Assets (ROA) -0.20% -0.05%

NCUA Net Worth / Assets Ratio (Capital Ratio) 9.24% 10.38%

Regular Net Income Percent of Total Income -5.88% -1.15%(before NCUA Assessments)

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2020 annual mtg minutes review - final

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